Friday, September 7, 2018

Trends, and hiccups, in music's globalization. | Water & Music

Happy Friday!

Since this week's theme is about globalization, I'm going to take a brief moment first to gush about Crazy Rich Asians. If you haven't seen the movie yet, I highly encourage you at least to listen to the soundtrack. There are so many gems representing a variety of East/West musical exchanges—from traditional Chinese jazz tunes from the '50s, to performances by Rap of China contestant Vava as well as Asian-American YouTube veterans Kina Grannis and Awkwafina (the latter of whom also stars in the film). I'm also currently writing an article about CRA and Chinese jazz for a new Chinese publication, which I'll share in the next newsletter issue. :)

Now let's formally dive in. Today's topic is a combination of various news articles, conference panels and offhand conversations that I've been itching to digest and synthesize for a while.

I'll start with two claims I've heard in conversation so far in 2018:

"Within the next five years, we're going to have a No. 1 hit single in Europe and the Americas recorded by an artist who isn't from those markets." (CEO of a major recording/publishing company)

"Within the next two years, we're going to have a Bollywood crossover single at No. 1 on the Billboard charts." (SVP at major publishing company)

There are a few themes to unpack here. The first quote refers to how localized music cultures, previously bound by geography, are gaining international recognition and acceptance in their own right among consumers in the biggest music markets. The second quote points to a somewhat different dynamic, whereby local and international cultures blend together into a crossover style that sounds familiar yet "just fresh enough" to consumers in said major markets.

The recent creative intersection of K-pop and Latin musical styles is a compelling example of how the two above approaches are not mutually exclusive, but rather overlap with and complement each other—if done correctly.

There is a general industry consensus that 2017 was a watershed moment for the rise of reggaeton and other Latin music styles, thanks to the global success of songs like "Despacito" and "Mi Gente." What's more, Latin artists reign on streaming, and the platforms themselves are sharing the data to prove it. Consider how Puerto Rican artist Ozuna is the most-streamed artist on YouTube so far this year, with a cumulative 2.7 billion streams in the five months, while J. Balvin recently became Spotify's most-streamed artist of all time, taking over Drake's No. 1 spot.

Partially in response to this trend, K-pop groups are churning out Latin-inspired tracks. Super Junior's "Lo Siento," which features lyrics in Korean, Spanish and English, was the first K-pop single ever to land on Billboard's Latin Digital Song Sales chart back in April. BTS' tango-infused "Airplane pt. 2" was released shortly thereafter.

While this might seem like artificial exploitation of a trend—after all, the K-pop industry is hands down one of the most aggressive corporate machines in entertainment—it’s also important to note that some of K-pop’s most avid fanbases are already located in Latin America. Several boy bands have performed sold-out shows in cities including Mexico City, Brazil and Chile, while Brazilian K-pop fan accounts on Twitter are some of the most enthusiastic and aggressive of the lot. In other words, the audience preemptively justifies the crossover, not the other way around.

What's more, K-pop is just one lever of a national mission that the Korean government refers to as "localizing hallyu," or introducing and integrating the modern wave of Korean culture into local markets around the world. SM Entertainment, one of the biggest K-pop entertainment companies, has particularly ambitious plans to hyperlocalize K-pop across different international markets—even going so far as to build and launch new K-pop groups entirely from artists in foreign countries, particularly China and Brazil. The "foreign" K-pop groups would then tap into a global marketing and distribution network that SM Entertainment founder Lee Soo-man called "New Culture Technology" (NCT).

What fascinates me about the phrase "New Culture Technology" is that SM Entertainment is treating K-pop like a tech product in its global expansion strategy.

Think about the myriadchallengesthat Spotify faces as it tries to maintain its impressive growth metrics on a global scale as a public company. One important lesson that Spotify and its rivals are learning is thatthere's no one-size-fits-all music solution that fits every single market in the world. Rather, each market has its own unique tech ecosystem, social customs and financial circumstances that have a significant impact onpricing,payment methods,product features,corporate partnershipsand overall market penetration for the services in question.

Lee Soo-man has a similar thesis about his artists:even for the biggest A-list acts, trying to make "one-size-fits-all music" is ultimately a lost cause.Instead, artists can try to tailor singles to different markets, cultures and customs (whether through lyrics, instrumentation, rhythm or other), casting their marketing net truly global in the process.

Of course, this process isn't appropriate for every type of artist, and in any case there are certain infrastructural obstacles that artists face in the attempt to maximize whatever localization strategy they might have. For instance, I've been told that with Spotify's new playlist pitching system, artists and labels cannot submit different tracks for different markets to the service. While this isn't that different from how the original pitching funnel worked, to me it still seems disadvantageous that artists are privy to platform limitations when trying to maximize their catalog on a global scale and cater directly to local listeners. This could have significant consequences especially given Spotify's growing number of direct deals with independent artists, which give said artists direct access to Spotify's internal curation team.

As another streaming-related example, the Chartmetric team published a great blog post comparing streaming stats for DIY versus major-label artists. One of the most compelling findings from the study is that DIY artists capture a much more global audience than the majors do, even though the artists all have similar styles and the majors supposedly have a more "global" marketing army behind them. On average, nearly 90% of the major-label artists' listeners were in North America and Europe, compared to just 55% for the DIYs.

As the blog post explains, this discrepancy is likely due to the "lack of incentives for major labels to advocate outside of their home markets," despite gargantuan marketing budgets. "The territory-centric corporate structure of the major labels encourages local executives and staff to focus on domestic repertoire," reads the post.

Now to bring all of this full circle: we're seeing some of the negative impact of these territory-centric incentives for major labels as they expand into emerging markets, particularly into Africa.

At the Midem conference last June, I spent much of the first day sitting on the Africa Forum, in which several artists and execs discussed how the African continent—which has influenced so much of today's music culture without any real financial stake in that upside—is trying to strengthen its own local industry infrastructure on its own terms.

One consistent theme that was repeated across nearly all the panels was that the African music industry won't succeed on the same models that currently exist in the U.S. and Europe. According to my notes from that day, Philo—a Congolese record producer and founder of indie label Bomaye Musik—was particularly outspoken about the potential drawbacks of the incumbent major labels building their presence on the continent.

"Majors don’t take time to work with local realities," said Philo, referring to how the majors tend to prioritize exporting to France and other Western countries instead of working the market domestically. "They only work with French realities or European realities. You can't adapt the French model to Africa because it's not the same environment." Philo then suggested that labels make a more explicit long-term investment in local content, perhaps by "using some of the revenues from their Francophone African artists to support local African music communities."

Recent news and reports seem to underscore Philo's comments. Universal Music Group expanded its African operations in July, but is still limited to French-speaking markets (UMG's parent company Vivendi is a French conglomerate). Joey Akan, Music Editor at Nigerian media site Pulse, has done some amazing reporting on how Sony Music left its Nigerian artists behind and pulled back on its support for locally-recorded music, even though the label was perceived as a "pioneer" for opening a new office in that country.

This is not to say that the majors don't play a huge role in infusing cash into the local music scenes in Africa, as well as exporting top African artists to international audiences. In this sense, they are indeed pioneers. But the near-unanimous tension that African music professionals feel with the major-label ecosystem reinforces how there is no singular globalization "template" that works for everyone, and local artists have heightened skepticism of using homogenous and/or Eurocentric models to lift themselves up. I'm excited to see what new models creative communities in Africa and other emerging music markets will build for themselves.

I would love to hear your thoughts on all of the above trends, as well as any other examples you have of where the music industry has either succeeded or stumbled on its path to globalization. Are there any new localized business models for music that have caught you eye? Am I misunderstanding anything about how labels work in these contexts? Is K-pop's cooptation of Latin styles a smart move? Why or why not? Simply reply to this email to share your thoughts—I'd love to hear from you!